SOCIAL SECURITY TO INCREASE BY 2%

Medicare Part B Also Expected To Rise

October 17, 2017: It’s now official. Just yesterday the Social Security Administration (SSA) announced that the 2018 COLA (Cost-of-Living Adjustment) for Social Security beneficiaries will be 2.0%, starting with benefits paid this coming January. This 2% COLA will produce an average increase of $27 in monthly SS benefits next year.

 

This is a marked difference in the COLA over the past couple years. Members, receiving Social Security, saw a meager 0.3% (three-tenths percent) COLA this year and zero raise in benefits for 2016. It also is the largest increase since 2011 when benefits were upped by 3.6%. 

 

“This relatively positive news for members, who are SS recipients, must be tempered by reports that their Medicare Part B premiums may also be going up. While the federal CMS (Centers for Medicare and Medicaid Services) will not be making an official announcement for several weeks on the 2018 Part B premium, there are projections being circulated that for 2018 the Part B premium could increase to $134 – a $25 hike or 22.9% increase! (Please note that members who are (what we call) “direct payers” and are currently paying $134 monthly, would see no Part B increase if the projections hold true.)

 

Why such a whooping increase for many members? Remember the Part B premium is calculated each year, as it is now being done for next year. For this year and last year, most retirees got a break on a Part B increase and paid no or very little because they received no COLA in 2016 and only 0.3% in 2017. Basically they’ve been “protected”, and paying much less of a premium increase than they would have if Social Security’s COLA had been greater. 

 

But the COLA will be more in 2018. Consequently next year Medicare enrollees, who have been receiving a break for two years and paying a reduced or no hike in the Part B premium, will no longer be protected and will be sharing equally in the increase.

 

Again please remember that the Medicare Part B increase has not been finalized and the figures are projections only. We will keep you posted.

 

BLS also calculates an experimental CPI for the elderly, or CPI-E, by using households whose reference person or spouse is 62 years of age or older. In 2009–2010, approximately 24 percent of all consumer units met the CPI-E's definition of having a reference person or spouse 62 years of age or older.

 

Tags: